Uganda to benefit as Kenya slashes pipeline charges

November 12, 2019 in Business, Companies, Markets by Editor

Uganda and other hinterland countries could see significant savings on their fuel procurement costs as Kenya  moves to reduce the tariff for its refined petroleum products pipeline by half. The move comes as competition for transit cargo between Dar es Salaam and Mombasa intensifies.

According to Kenyan media reports, EPRA, the Energy and Petroleum Regulatory Authority  is scheduled to gazette new tariffs which will initially see the cost of ferrying a cubic metre of fluid fall from USD60 to USD30.89. From then on, tariffs are scheduled to fall further, to reach a floor of USD 29.07 in 2021.

The move is seen as a direct response to a recent shift in the regional fuel haulage market that saw shippers shift to Dar es Salaam over higher tariffs by Kenya Pipeline Company and longer dwell times at Mombasa port.

Tanzania has recently upped its game, setting up an inter-agency and stakeholder task-force to further improve service levels and competitiveness at Dar es Salaam.

Tanzania also scrapped delivery fees, stripping fees, export fees, and container cleaning charges at its Dar es Salaam port.